Determinants of Operational Efficiency in Asian Banking: A Two-stage Banking Model Analysis

This paper applies a two-stage banking model to analyze the operational efficiency of 137 Asian banks. Tobit regression model is also used to investigate the effect under the different operating environment and the characteristics of banks on banking efficiency. The empirical results show that technical inefficiency in the production stage for all the Asian banks is caused by pure technical inefficiency. In the intermediary stage, the banks ’ technica